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“Our Navy is smaller now than at any time since 1917,” Romney said. “The Navy said they needed 313 ships to carry out their mission. We’re now at under 285. We’re headed down to the low 200s if we go through a sequestration. That’s unacceptable to me."

“We also have fewer horses and bayonets,” Obama responded sharply. He then added that fewer ships and planes were needed because of the development of aircraft carriers and nuclear submarines.

“It’s not a game of Battleship, where we’re counting ships,” Obama said.

The president also argued that sequestration was set up by Congress, not his administration, and that it would not happen.

Obama and Congress agreed to the automatic cuts as part of a deal last summer to raise the debt ceiling. Both sides agreed that painful cuts would be implemented if a supercommittee of lawmakers failed to come up with a deficit-reduction plan.

McCain said when he debated the president in 2008, he had the principle not to stoop to that level of “ridicule.”

“By the way, this line about horses and swords or whatever that was?” McCain continued. “That’s snarky, that’s just snarky. I never did that to the community organizer about his experience back in 2008 — maybe I should’ve, although I never would’ve. But the point is his ridicule of Mitt Romney was both unpresidential and frankly, in my view, unacceptable.”

Critics of Romney’s debate performance say he passed on an easy opportunity to criticize the president over his preparedness for and handling of the attacks on the U.S. Consulate in Libya.

McCain said Romney should have seized that opportunity, but that he did enough to convince voters he would make a strong commander in chief.

“I think in my view it probably would have been something that was on the agenda,” McCain said. “But I also think that Mitt Romney did the job he needed to do and that was show the American people that he has the qualities necessary to be the commander in chief.”